Property investors borrowed record sums at historically low rates. As the bill comes due and interest rates rise, ‘the chickens are coming home to roost.’
By Rebecca Picciotto
Sept. 21, 2026
Few investors are feeling more pain from rising interest rates than America’s apartment landlords.
These property owners face a bill of more than $1.8 trillion in debt over the next decade. From this year to 2028, about $757 billion of those loans are coming due, according to the Mortgage Bankers Association. That is the most of any commercial real-estate sector.
Nearly $300 billion of those loans are maturing in 2026 alone. This follows a record-setting 2025, when $310 billion in loans came due, the highest the sector had seen in a single year since the Mortgage Bankers Association started tracking. Another $223 billion is due next year.
Now, after the Federal Reserve raised rates a quarter point and with bond yields rising, that debt is about to become a much bigger burden. Landlords are having to refinance when borrowing rates are roughly twice the level of five years ago, when many of these loans were made.
When apartment-mortgage rates tumbled to historic lows of around 3% in 2020 and 2021, multifamily buildings were the hottest investment in commercial real estate. Office and retail properties suffered after urban downtowns were hollowed out by remote work. The lodging business took a hit when travel activity drooped during the pandemic, while soaring operating costs and plunging occupancy rates caused hundreds of senior housing facilities to close.
Apartment rents, meanwhile, were surging at double digits nationwide. Multifamily became a refuge for real-estate investors amid the doom spiral in other sectors.
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Fast forward, many of the same apartment landlords riding high are now preparing to sell at a loss, hand back the keys to their lenders or reconfigure their balance sheets to shoulder millions more in mortgage payments after refinancing.
The financial strain is already causing developers to pare back on new construction and instead buy distressed properties at a sharp discount.
“The chickens are coming home to roost for a lot of people,” said Sean Burton, chief executive of the multifamily firm Cityview.
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Meanwhile, cash-flush buyers are circling these distressed properties. Burton of Cityview is one of them.
Cityview is buying directly from lenders who have assumed control of properties, something the firm hasn’t done in years, Burton said. Cityview is getting a roughly 40% discount for a newly renovated apartment complex in the Dallas metro area that was foreclosed on.
“It’s some of the best buying opportunities I’ve seen in my career,” he said.
